The Best Time for a Performance Review

“When people are financially invested, they want a return. When people are emotionally invested, they want to contribute.” Simon Sinek

This post is not about entering the should we or shouldn’t we have a performance review discussion. There has been plenty of discussion on the pros and cons of performance reviews and many ideas and innovations for improvement have been identified by consultants and progressive organisations. One thing remains clear. Individual performance will continue to be assessed with a view to enhancing current performance or turning around less than satisfactory performance.

This post is coming from the belief that most people want to know where they stand. They want to hear it from their boss. And, handled well, most people are willing to engage in a discussion on ways to take their performance to a higher level.

Another caveat.

I’m working on the assumption that all your managers are checking in with their team members and giving quality feedback on a regular basis. If that isn’t happening in your organisation well, I’m afraid you’ve got bigger problems.

I’m talking here about the annual performance review, or appraisal or whatever your organisation calls it. That once a year event where manager and team member get together. They talk about what was done, how it was done and what could be better in the year ahead.

“The idea of a merit rating is alluring. The sound of the words captivates the imagination: pay for what you get; get what you pay for; motivate people to do their best, for their own good. The effect is exactly the opposite of what the words promise.” W Edwards Demming

The ‘tradition’ is that appraisals are done once the organisation’s end of year financial results are finalised. Results are posted, and individuals tally up their contributions, managers allocate ratings and attend ‘calibration’ sessions to ensure horizontal fairness and equity. And then salary increases, and, in some cases, incentive payments are agreed and put through several levels of approval. And then managers are given the go-ahead to conduct the review and inform the employee of their rating and financial reward.

For many large organisations this is a process that can last two to three months. For the employees in these organisations, this means that they don’t have a performance discussion until sometime in Quarter 2 of the next business cycle.

This whole catastrophe is lumped together this way and at this time for two reasons:

The ‘accepted belief’ that we can’t or shouldn’t assess performance until the end of the year and,

HR’s ‘accepted belief’ that it is more efficient to corral all this activity into one period of the year.

The problem is, cramming the evaluation, calibration and award distribution process and therefore the all-important one on one discussions into one process clearly isn’t the best way to ensure people get actionable feedback on their current performance and what’s expected of them in the future.

An Aside

If at this point you’re wondering, ‘is there a better way?’. Yes, I think there is. BUT the fact is most organisations are tied to a performance review framework replicating the approach established in the middle of last century. This is reinforced by most digital HR platforms which are simply replicating and automating that same core process so aren’t, in themselves, improving the quality of conversation.

Good execution of performance appraisal is not the solution. More people are realising that improving how performance appraisals are done is an attempt to do the wrong thing better.

If you insist on doing the wrong thing, I suppose you might as well do it better but how about just not doing the wrong thing at all? John Hunter

If you are stuck with the status quo then when is the best time for a performance review?

Now, this will challenge long and widely held beliefs. I propose that the best time to conduct an effective performance review is during the third quarter of the business year.

I say this for two reasons:

There’s enough of the year completed and therefore enough data and observable trends for a manager to make an accurate assessment of current performance and behaviour

There’s enough time to do some deep thinking and discuss how things could be even better in the next financial year.

I make this suggestion because I’m most interested in the people performance outcome over the enabling HR process. That is, individuals having the opportunity to hear where they stand from their manager and to work with them to focus on the future performance and development.

If you feel there could be another way . . .

If this post has made you consider exploring what a new approach to people performance could look like, get in touch. It costs nothing to whiteboard a few ideas. At worst you can continue improving what you already have. At best, you will shift the performance culture of your entire organisation.

Justin Miles

Manager Partner, Melbourne at Generator Talent

Justin is the Managing Partner of our Melbourne office, an outcome focused leader with a track record of driving business performance through proven talent and organisation development practices. Justin’s methods and skills have been shaped by working with performance oriented leaders in great companies including PepsiCo, The Campbell Soup Company, Diageo, Rip Curl, Fonterra and Wesfarmers, in Australia, the USA and Latin America.